Anthem pulls out of Obamacare in Nevada and parts of Georgia

John SextonPosted at 7:21 pm on August 7, 2017

CNN Money’s story about Anthem’s announcement that it will pull out of the Obamacare exchange in Nevada and parts of Georgia opens “The exodus has begun.” Actually, the exodus has been going on for months.

Anthem is pulling out of Nevada’s Obamacare exchange for 2018 and cutting its presence in Georgia’s marketplace roughly in half, the company announced Monday.

Other insurers are also expected to downsize their involvement or to hike rates in coming weeks…

“Today, planning and pricing for ACA-compliant health plans has become increasingly difficult due to a shrinking and deteriorating individual market, as well as continual changes and uncertainty in federal operations, rules and guidance, including cost sharing reduction subsidies and the restoration of taxes on fully insured coverage,” the company said in a statement.

In Georgia, Anthem will be pulling out of the Atlanta market but remaining in 85 of 159 mostly rural counties. That move is intended to prevent those counties from losing their last remaining insurer. This comes after Anthem announced last week it was pulling out of most regions of California, with the exception of a few parts of northern California and the central valley. About 10% of those currently insured under Obamacare in California (known as Covered California) will have to seek a new insurer next year.

Insurers have until late September to make a final decision on their participation in the exchanges. Despite the Senate’s failure to pass an Obamacare repeal bill, uncertainty over the continuation of cost-sharing reduction payments has many insurers on edge.

The GOP won a court case last year saying there was no congressional authorization for the payments. The Obama administration was appealing the decision but that was expected to change once Trump won the election.

In fact, Trump has threatened to cut the payments several times but has asked for extensions from the court to determine how he wanted to proceed. Last week, a federal appeals court ruled that attorneys general from states that support the payments could join in opposing the case. That means even if Trump drops the case now it could continue. However, Trump could still cut off the payments at any time. From Kaiser Health News:

Trump could still yank the payments. Insurers can’t count on the money, estimated at $10 billion for next year.

And consumers are still likely to see high premium increases for 2018 as insurers plan for the worst.

The court decision notwithstanding, Trump’s ability to stop the subsidies “is not diminished,” said Justin Giovannelli, a research professor at Georgetown University’s Center on Health Insurance Reforms. “The administration could still determine that they don’t believe they need to make the payment and will not make the payment.”

Trump could cut off the cost-sharing payments before the September deadline for insurers to withdraw and the result would be catastrophic for Obamacare. But, so far, it seems he’s not prepared to take the heat for making a call which would likely result in millions of people having no options for health insurance next year.